Slide 1



MaRS   Follow or Tweet:#ent101
`
       Nuts and Bolts of Starting
              a Business
   Presented by:

   Tony Redpath                          Je...
Creating an Ecosystem…

       When you start an enterprise, you have to work within
       an existing ecosystem while se...
Your Ecosystem..
       Just at the beginning…..




                      You       Your
            Your
               ...
What should be my first step?
       Incorporation
     For   Profit and Non Profit Organizations:
        For Profit In...
Incorporation in Ontario

    Provincial   For Profit
        Incorporation
          Service Ontario website
         ...
Incorporation in the US
        Moving South of the Border?
           For Profit Options:
             Delaware incorpo...
After incorporation, taxes will follow
       ….

        Regardless of incorporation jurisdiction, taxes
        are a r...
Rules of the Incorporation & Taxes
       Lesson number 1: Get Help!

    “The    incorporation process can be very compl...
Your Ecosystem
       The Expansion Continues


                       Federal and
                     Provincial Govt.

...
Post Incorporation..
       Founders, partners & employees
        Youwill need a shareholders agreement – it can be 1
  ...
Are you going to have employees?

    More    taxes – you need to remit payroll
       deductions for income tax, Employm...
Your Ecosystem


                    Federal and
                  Provincial Govt.      WSIB



              Your       ...
Where should I register my
       enterprise name?
     How   do I register my enterprise name?
        Canada Business ...
Types of Organizations
       Research and Development

    Scientific   Research and Experimental Development tax credit...
Your Ecosystem


            CRA
                     Federal and
                   Provincial Govt.      WSIB



       ...
Beginning to build your network
        Establish a commercial network that compliments
        your existing networks

  ...
Your Ecosystem


                          Federal and
                 CRA                        WSIB
                  ...
Consider things NOT to do….

     Don’t  run out and commit to a big office with lots of fancy
       furniture – get the...
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Basic Nuts and Bolts of Building a Business

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In this session, we deal with the nuts and bolts of starting a company, including:

* How do you incorporate?
* What government agencies do you have to engage with (after all, they will want to tax all that money you are making)?
* How do you start off plugging yourself into your customer community?

Part of the MaRS CIBC Presents Entrepeneurship 101 lecture series: http://www.marsdd.com/ent101

Published in: Business, Technology
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Basic Nuts and Bolts of Building a Business

  1. 1. Slide 1 MaRS Follow or Tweet:#ent101
  2. 2. ` Nuts and Bolts of Starting a Business Presented by: Tony Redpath Jennifer R. White Vice President, Partner Programs Social Entrepreneur in Residence MaRS Discovery District MaRS Discovery District Dan Bolger, CIBC Business Banking Advisor, GTA North October 28th, 2009 Slide 2 MaRS
  3. 3. Creating an Ecosystem… When you start an enterprise, you have to work within an existing ecosystem while seeking to create your own relationship network and ecosystem…  Customers  Suppliers / Providers  Government  Regulatory bodies  Trade Associations Slide 3 MaRS
  4. 4. Your Ecosystem.. Just at the beginning….. You Your Your Inc. Customers Suppliers Slide 4 MaRS
  5. 5. What should be my first step? Incorporation   For Profit and Non Profit Organizations:  For Profit Incorporation  Federal incorporation – Canada Business website – Canada Business Corporations Act  Non Profit Organizations  Canada Non for Profit Corporations Act  Non for Profit Incorporators Handbook   Charitable Status Slide 5 MaRS
  6. 6. Incorporation in Ontario  Provincial For Profit Incorporation   Service Ontario website   Business Corporations Act   Provincial for Non Profit Organizations   CRA Website Slide 6 MaRS
  7. 7. Incorporation in the US Moving South of the Border?   For Profit Options:  Delaware incorporation   US Investor Base   Non Profit Options   Guide Star   Filing Requirements – IRS   L3C Legal Structure Slide 7 MaRS
  8. 8. After incorporation, taxes will follow ….  Regardless of incorporation jurisdiction, taxes are a requirement  Federal Corporate Tax  Provincial Corporate Tax  GST/PST Slide 8 MaRS
  9. 9. Rules of the Incorporation & Taxes Lesson number 1: Get Help!  “The incorporation process can be very complex. You may wish to obtain legal and tax advice to assist you with the preparation of the incorporation documents and shareholders' agreements.”  Canada Business website   Approximate cost to hire an accountant / lawyer to handle all the above paperwork is $800 - $1500 Slide 9 MaRS
  10. 10. Your Ecosystem The Expansion Continues Federal and Provincial Govt. Your You Your Suppliers Inc. Customers Lawyer Accountant Slide 10 MaRS
  11. 11. Post Incorporation.. Founders, partners & employees  Youwill need a shareholders agreement – it can be 1 page or 100 pages, but it must cover, at a minimum:  What is the ownership split (at the start; sweat equity vs salary)  How are decisions made  What are each person’s responsibilities  Assignment of Intellectual Property  There are many other issues that can be covered in a shareholders agreement (see Term Sheet lecture)  Legal advice is highly recommended Slide 11 MaRS
  12. 12. Are you going to have employees?  More taxes – you need to remit payroll deductions for income tax, Employment Insurance, Canada Pension Plan (the good news is that when you get the other federal tax numbers, you will also be set up for payroll taxes)  You need to register with the Workplace Safety and Insurance Board (WSIB) Slide 12 MaRS
  13. 13. Your Ecosystem Federal and Provincial Govt. WSIB Your You Your Suppliers Inc. Customers Lawyer Accountant Slide 13 MaRS
  14. 14. Where should I register my enterprise name?   How do I register my enterprise name?  Canada Business website   How do I seek information about trademarks & patents?  Canadian Intellectual Property Office website Slide 14 MaRS
  15. 15. Types of Organizations Research and Development   Scientific Research and Experimental Development tax credits (SREDs)  A major advantage for Canadian companies  Claimants can apply for SR&ED investment tax credits for expenditures such as wages, materials, machinery, equipment, some overhead, and SR&ED contracts.  Generally, a Canadian-controlled private corporation (CCPC) can earn an investment tax credit (ITC) of 35% up to the first $2 million of qualified expenditures for SR&ED carried out in Canada  Scientific Audit and Financial Audit  To qualify for the SR&ED program, work must advance the understanding of scientific relations or technologies, address scientific or technological uncertainty, and incorporate a Slide 15 MaRS systematic investigation by qualified personnel.
  16. 16. Your Ecosystem CRA Federal and Provincial Govt. WSIB Your You Your Suppliers Inc. Customers Lawyer Accountant Slide 16 MaRS
  17. 17. Beginning to build your network Establish a commercial network that compliments your existing networks   Building Effective Relationships 101   Professional Organizations & Trade Associations   Be Strategic   Too many to count….   Why do I need to be there? Who do I need to meet?   Scientific Conferences   Trade Shows   Partners   Government Officials   Your Bank Slide 17 MaRS
  18. 18. Your Ecosystem Federal and CRA WSIB Provincial Govt. Your You Your Suppliers Inc. Customers Bank Lawyer Accountant Trade associations Trade Shows Conferences Regional Networks Regulatory Bodies Slide 18 MaRS
  19. 19. Consider things NOT to do….   Don’t run out and commit to a big office with lots of fancy furniture – get the space that you need, shop at IKEA and grow your space as necessary   Don’t hire your relatives simply because they are available – get the team that you actually need   Don’t hire your lab, old college university friends mates UNLESS they can offer you something to build your organization Slide 19 MaRS

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